Google is paying Apple billions of dollars a year to be the main search engine on Apple devices.
According to Bloomberg, the more specific figure is that Google shares with Apple 36% of the total revenue they earn from searches performed on the Safari browser on iPhone, iPad and Mac.
Last month, asset management firm Bernstein estimated that Apple was receiving between $18 billion and $20 billion a year, contributing about 15% of its total annual operating profit.
Apple and Google have both tried to keep details under wraps in the antitrust lawsuit, claiming that sharing the information publicly would “undermine Google’s competitive position.”
Google has been the default search engine on Apple devices since 2002, although the agreement between the two companies has been amended several times.
Apple makes a lot of money from the deal, while Google becomes the default search option on the iPhone, the world's most popular smartphone.
The US Justice Department is investigating Google for what it believes is a search monopoly. Google's lucrative search engine deal with Apple is the main focus of the legal battle, which is expected to last until the end of November.
In October, Microsoft CEO Satya Nadella said the deal between Apple and Google made it impossible for other search engines like Bing to compete.
“You wake up in the morning, you brush your teeth, you do a Google search,” Nadella said. “With that level of habit formation, the only way to change it is to change the default (tool).”
Microsoft once approached Apple about acquiring Bing to create its own search engine, but Apple was not interested.
The company is concerned that Bing cannot compete with Google on "quality and capability," and Apple has no reason to lose the money it makes from Google.
Apple services chief Eddy Cue testified at a trial in October that Google is the iPhone's default search engine because it's the best option.
“We left Google as the default search engine because we always thought it was the best,” Cue said. Apple was unable to make changes to the agreement because there was no “valid alternative.”
While Google is the default search engine on Apple devices, users can switch to Yahoo, Bing, DuckDuckGo or Ecosia instead, but they need to go into the Safari browser settings.
If Google loses its antitrust case, the Apple-Google deal could be overturned. Apple could be forced to allow customers to choose their search engine when setting up their Apple devices instead of making Google the default.
Losing billions of dollars from Google could be the catalyst Apple needs to develop its own search engine. Apple has considered building a search solution.
Apple's AI chief John Giannandrea runs an internal search team and has been developing a next-generation search engine for Apple apps that could form the basis of a Google Search alternative.
If the Google-Apple deal ends, it could be years before any changes happen. Even if a ruling is made, Google will likely appeal if it doesn’t go the way the company hoped.
(According to MacRumors)
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